GSR compromise motion hearing Oct. 24

By Rick Catlin. Islander Reporter

A motion by GSR Development LLC to "compromise controversy" with Bon Eau Enterprises LLC will be heard in federal bankruptcy court at 2:30 p.m. Tuesday, Oct. 24.

In its emergency motion, GSR asks Judge K. Rodney May to grant the company until Dec. 15, 2006, to exercise its $100,000 repurchase option with Bon Eau on GSR's Villa Rosa property in Anna Maria. GSR also asked for the same deadline to close a sale on the Villa Rosa property. Both would take place on or before Dec. 15, GSR attorney Richard Prosser said.

Prosser said that if the $100,000 isn't paid by the Dec. 15 deadline, or if paid, but not all of the Villa Rosa property is purchased by that day, then all of GSR's interest and claims to any "unsold lots" in Villa Rosa "would be terminated and deemed null and void."

In plain English, it means if GSR can't come up with the $100,000 and close on a sale of Villa Rosa by the due date, the company no longer has any claims on the property.

But if May denies the emergency motion, GSR said it would reserve all of its "claims, rights and remedies" on Villa Rosa.

The unsecured creditors committee for the GSR bankruptcy has submitted its own opinion on the motion to Judge May, claiming that Bon Eau's deal with GSR was "criminally usurious" and was a "disguised loan." The committee also claimed that the Bon Eau deal is unenforceable because GSR was insolvent at the time of the loan and Bon Eau was aware of GSR's financial situation.

The federal bankruptcy court is located at 801 N. Florida Ave., Suite 727, in Tampa.

Name correction

The story in the Oct. 4 issue of The Islander on the motion to appoint William Maloney as GSR Development's restructuring manager should have said that one of GSR's principals is Robert Byrne, not Richard Byrne, as reported.

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